Farmers hit by compulsory purchase of their land or property may soon receive a fairer rate of interest when their compensation payments are late.
Following a consultation, the Department for Communities and Local Government and HM Treasury have proposed a new penalty interest rate of 8% above base rate for late payments. This is in line with standard government practice.
The current rate of interest on late payments for acquiring authorities such as HS2 Ltd is 0.5% below base rate, so with base rate at 0.5%, those affected typically receive no interest at all on late payments.